By Commodity News Service Canada
WINNIPEG, Jan. 20 – The Canadian dollar was sharply lower against the US dollar on Tuesday, dropping more than a full cent and hitting its lowest levels since early 2009.
The Canadian dollar closed at US$0.8260 or US$1=C$1.2107 on Tuesday, which compares with Monday’s North American settlement of US$0.8370 or US$1=C$1.1947.
Disappointing Canadian manufacturing sales data helped to weigh on the loonie. Statistics Canada said manufacturing sales fell 1.4 per cent in November, well below expectations of a 0.7 per cent decline.
Worries that the Bank of Canada will decide to delay raising key interest rates in Wednesday’s policy rate announcement added to the bearish tone.
Further downward pressure came from ongoing worries about slow global economic growth and weakness seen in crude oil values on Tuesday.
Canadian bonds closed sharply higher on Tuesday, reacting to ongoing weakness in crude oil values and soft Canadian manufacturing data, brokers said.
The two-year bond yielded 0.853% late Tuesday, from 0.859% late Monday. The 10-year bond yielded 1.500%, from 1.516%. Bond yields fall as their prices rise.
